FCC czar proposes rule rewrite

Martin calls for partial lift of cross-ownership ban

Federal Communications Commission chairman Kevin J. Martin proposed a partial lifting of the newspaper-broadcaster cross-ownership ban that would allow media companies to own a newspaper and a television station in a single market under certain conditions.

Only the top 20 markets in the country would qualify, and a newspaper’s parent company could not own one of the four highest-rated TV stations in the market.

Cross-ownership in smaller markets would only be possible via waiver from the commission, which would decide on applications on a case-by-case basis.

In 2003, when the FCC previously attempted to loosen media ownership restrictions, the commission proposed dropping the ban completely in all markets. That was part of a set of proposed changes that a federal court in Philadelphia blocked. The court ordered the FCC to better explain and justify its plans.

“This one will probably pass muster with the court,” said former FCC attorney and communications law expert Jerome Boros of law firm Bryan Cave. “It’s well thought out.”

News Corp., which owns two stations in New York as well as the New York Post, would likely not be affected if Martin’s proposal were to be approved. The company has a permanent waiver from the FCC to own those assets.

Removal of the ban has been a top priority for Tribune Co., owner of the Los Angeles Times, the Chicago Tribune and 23 television stations. Tribune is the subject of an $8.2 billion buyout that would take the company private.

Martin’s proposal would provide relief in four of the five markets where Tribune owns broadcast stations and newspapers. But the company wants temporary waivers, saying Martin’s planned Dec. 18 vote on his proposal is too late and may jeopardize financing for the deal.

Under Martin’s proposal, Tribune would have to sell off assets in Hartford, Conn., a sub-top 20 market, where it owns the Hartford Courant and a number of television stations.

Martin said, while the FCC has spent the past 18 months reviewing four media ownership rules for possible revision, cross-ownership is the only one he thinks should be changed.

Martin announced his proposal in an op-ed Tuesday for the New York Times.

“Beyond giving newspapers in large markets the chance to buy one local TV or radio station, no other ownership rule would be altered,” Martin wrote. “Other companies would not be allowed to own any more radio or television stations, either in a single market or nationally, than they already do.

“This relatively minor loosening of the ban on cross-ownership of newspapers and TV stations in markets where there are many voices and sufficient competition to allow for new entrants would help strike a balance between ensuring the quality of local news while guarding against too much concentration,” Martin continued, claiming that his proposal would rescue newspapers from “withering and dying.”

Sen. Byron Dorgan (D-N.D.), who has criticized Martin for “moving too quickly” on media ownership changes, wasn’t persuaded by Martin’s argument for loosening the cross-ownership ban.

Martin “has yet to make the case for why any further media consolidation is necessary,” Dorgan said in a statement. “Indeed, he is relying on an assumption that newspapers are doomed and that cross-ownership is necessary to save them. I believe this is not the case. He has also failed to make the case that cross-ownership will be beneficial to local communities — that requires an understanding of how ownership affects local coverage.

“The FCC still has not completed a separate proceeding with a thorough study of the impact of media concentration on localism,” Dorgan continued. “In my view, that work is necessary and a prerequisite to any discussion of whether media ownership rules ought to be changed.”

Democratic commissioners Michael Copps and Jonathan Adelstein were more critical of the proposal.

“This is portrayed as a moderate proposal, but it is a wolf in sheep’s clothing,” Copps and Adelstein said in a joint statement. “Don’t let the wool be pulled over your eyes. The proposal could repeal the ban in every market in America, not just the top 20. Any city, no matter how small, could be subjected to newspaper broadcast ownership combinations under a very loose standard.”

(The Associated Press contributed to this report.)

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